Configuration Details:

If set to ON Squid will automatically retry requests when
receiving an error response with status 403 (Forbidden),
500 (Internal Error), 501 or 503 (Service not available).
Status 502 and 504 (Gateway errors) are always retried.
This is mainly useful if you are in a complex cache hierarchy to
work around access control errors.
NOTE: This retry will attempt to find another working destination.
Which is different from the server which just failed.